Letter from the Editor

摘要

FINANCIAL CRISES IN GREECE AND OTHER EUROPEAN COUNTRIES have rocked the continent and the euro. Some blame the inevitable internal contradictions of a monetary union itself. But to Tom Palley, the union has not gone too far-rather, it has not gone far enough. As he puts it, the euro solved Europe's problem of exchange-rate speculation by having its currency managed by the European Central Bank. But in doing so, it ended up replacing damaging exchange-rate speculation with damaging speculation in bonds. This can be remedied, he claims, with the creation of a European Public Finance Authority that would issue bonds backed by eurozone member countries. In other words, a monetary union needs a corresponding fiscal union. Politics might intervene, but this may well be the right path to follow.